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The results of the
2017 Strategic Benefits Survey send a clear message: To stay relevant in this competitive, global job market, organizations need to move away from the status quo and think more strategically about their benefits offerings. Read more below to learn about the impact of benefits and how to use them as a strategic tool.
What does it mean to use benefits strategically?
Strategic benefits planning seeks to utilize employee benefits as assets and tools to support an organization's business goals and to positively affect the bottom line.
- 85% of HR professionals said their organization used benefits as a strategic tool to positively affect recruitment and/or retention.1 These organizations are considered strategic benefits users.
Why are strategic benefits important?
Economic Climate- From 2015 to 2017, the unemployment rate has declined by approximately 20%.2 This is a sign of a healthy economy, but can make it more difficult for employers to recruit and retain the talent they need.
- The difference between the skills available in the workforce and the skills needed by employers is contributing to recruiting difficulty. The skills gap is forecasted to grow in the future, especially for high-skilled occupations like health care professionals, engineers, scientists, skilled trades, technicians, computer scientists and mathematicians.3
Cost of Benefits- Employee benefits are expensive. Roughly one-third (32%) of total compensation costs are allocated to employee benefits.4 Using strategies based on specific data to make changes to your organization's current benefits offerings can help get the greatest return on investment and impact on the bottom line.
What challenges can your organization tackle with strategic benefits?
Overall Company Performance
- When organizations focus on using benefits strategically for recruitment and/or retention, they report better overall company performance compared with those maintaining the status quo.1
- Above-average company performance: 58% v 34%
Recruitment and Retention
- Strategic benefits users were more than twice as likely to report above-average effectiveness in recruitment compared with organizations that didn't use benefits strategically.1
- Above-average effective recruitment: 19% v 8%
- With 32% of employees citing benefits as a reason to stay with their organization and 29% citing them as a reason to leave, benefits play an important role in retention.3 Strategic benefits users rated their retention efforts as more effective than non-strategic benefits users.1
- Above-average effective retention: 28% v 11%
Employee Satisfaction
- Over 50% of employees say health care, leave and flex benefits are very important to job satisfaction, yet these three benefits have the largest gap in employee satisfaction.5 For example, 63% said health care benefits were important to their job satisfaction, but only 31% indicated they were satisfied with their health care benefits. Gathering employee feedback on benefits can help organizations narrow this gap.
The sections below describe the methods successful organizations use. Each section relates to certain aspects of managing your organization's benefits program.
Communicate Effectively
This section provides tips and strategies to communicate benefits more effectively to your employees. It will address some of the following common challenges:
- Selecting effective communication methods depending on such characteristics as staff size and HR structure.
- Delivering impactful benefits messaging.
- Communicating the value of benefits to employees.
What methods of communication are most effective?
The table below shows the overall percentage of HR professionals that rated each communication method as "very effective." The communication methods are grouped into four broad categories: face-to-face, virtual, information portal and materials.
If you dig deeper, effectiveness of a communication method may be different depending on the characteristics of an organization, such as:
- Staff size (small = 1 - 499 employees; large = 500 or more employees).
- Where the benefits policies are determined (centralized, decentralized or a combination of both).
Other factors to consider may include the number of business locations, employee demographics and preferences, access to technology, and whether employees are working onsite or offsite.
Face-to-Face
Fosters open communication. Requires coordination and planning.
|
Communication Method
|
Very Effective
|
Groups Reporting Higher Effectiveness
|
One-on-one
| 51%
| Small staff size
|
Orientation/on-boarding
| 40%
| Small staff size
Centralized HR
Combination HR
|
Group communications
| 37%
| Small staff size
|
Benefits fairs
| 26%
| Decentralized HR
|
Lunch-and-learn
| 21%
| Small staff size
|
Virtual
Provides on-demand access and wide reach. Requires technology and training.
|
Communication Method
|
Very Effective
|
Groups Reporting Higher Effectiveness
|
Bulletins to screensavers
| 20%
| No difference across groups
|
Webinars
| 15%
| No difference across groups
|
Social media
| 15%
| Centralized HR
Combination HR
|
Virtual education
| 14%
| No difference across groups
|
Information Portal
One-stop-shop for benefits. Requires ongoing maintenance and intuitive user interface.
|
Communication Method
|
Very Effective
|
Groups Reporting Higher Effectiveness
|
Online benefits portal
| 32% | No difference across groups
|
Intranet
| 21%
| No difference across groups
|
Materials
Allows for personalized communication methods. Requires current contact information.
|
Communication Method
|
Very Effective
|
Groups Reporting Higher Effectiveness
|
Enrollment materials
| 35%
| No difference across groups
|
E-mails
| 31%
| Small staff size
|
Text messages
| 25%
| No difference across groups
|
Direct mail to home/residence
| 16%
| Centralized HR
Combination HR
|
Handouts/pamphlets
| 15%
| Decentralized HR
|
Newsletters
| 13%
| No difference across groups
|
How can your organization have more impactful benefits messaging?
- Design a communication strategy. Develop a project plan and timeline for all benefits communications. Consider the frequency of communication, the audience, communication method, language to use, themes, etc.
- Tie benefits messaging to organizational values and culture. Show how your organization is committed to its values through its benefits offerings. For example, if your company values social responsibility, highlight your volunteer outreach program.
- Develop a theme or message to help communicate the purpose and value of all benefits offerings (e.g., logos, slogans).
- Select leaders and employees who will help champion employee benefits and serve as a source of feedback. For example, HR designates a team of wellness warriors who represent different departments for other employees to ask questions and get information on the program, lead lunchtime walks, etc.
Behavioral Science Tip: Presentation Matters
Challenge:
If employees feel overloaded with complex benefits information, it will be hard to make decisions and could affect enrollment choices.
- Give employees a high-level overview of benefits options.
- Provide scenarios based on life circumstances to guide employee decisions.
- Use language that is easy to understand; avoid jargon.
How can your organization communicate the value of benefits?
- Use a
total compensation statement to show how much the organization is contributing toward employee benefits.
- Explain how your organization's benefits compare to others in your industry or region using data from
SHRM's Benchmarking Service.
- Showcase progress on improving employee benefits over time.
- Be transparent in job postings on what benefits are offered.
HR Presentations:
Sources
1 2017 SHRM Strategic Benefits Survey